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What a Difference $400 Can Make...
Your State Tax Dollars Can Help Catholic Charities Help the Working Poor!
Arizona Charitable Tax Credit Program for the Working Poor
Reduce your tax liability while helping those who need it most. Thanks to the Arizona Charitable Tax Credit Program for the Working Poor, state taxpayers now have more incentive to make cash donations to Catholic Charities.
Contributions up to $400 may earn a dollar-for-dollar tax credit on Arizona income tax, which means your total tax bill can be reduced by this amount. In addition, your gift to Catholic Charities also qualifies as a charitable deduction on your federal return if you itemize.
Helping Those In Need: By giving to Catholic Charities, your donations stay in Arizona, and help those who really need assistance. Support from this dollar-for-dollar tax credit offers people a helping hand with their basic needs such as medical care, food, clothing, shelter, childcare, medical care, emergency assistance, job training services and job placement.
What YOUR $400 can provide:
- Food for a homeless family of four for a month
- Shelter for a month for a woman and her children who are escaping
domestic violence
- Mattresses and bedding for families who open their homes to foster children
- Backpacks and supplies for ten children entering Headstart education
- Job training and counseling for a young woman fleeing a life of prostitution
- And so much more!
Frequently Asked Questions
How does Catholic Charities help the working poor?
Catholic Charities has been serving the working poor of Arizona for nearly 75 years. Our mission is to protect and nurture vulnerable children, strengthen families and help people in crisis. The majority of our services are directed at the working poor and Catholic Charities has been certified as a qualifying agency for the tax credit by the State of Arizona. We provide Headstart and Early Headstart education to low income children and their families, housing to the homeless, diversion and rehabilitation services to prostituted women, shelter to families fleeing domestic violence, counseling and support to families in crisis, foster homes to children, and much, much more. Last year, Catholic Charities served over 200,000 Arizonans, providing over $30 million worth of services.
How does this tax credit affect the tax credits for private school tuition and public school extra-curricular activities?
You can receive a dollar-for-dollar tax credit for giving to all three! The working poor tax credit is different from the school tax credits. Thus, you can donate up to $400 to the working poor, up to $1,000 for private school tuition and $400 for public school extra-curricular activities.
What’s the difference between a tax credit and a tax deduction?
A tax deduction is an expense that reduces taxable income, which is the number upon which your tax liability is calculated. A tax credit, on the other hand, is applied to reduce your tax liability dollar-for-dollar. In other words, a tax credit comes right off the top of your state tax bill, lowering the amount of money you will pay.
Do I have to give $400 to get the tax credit?
You may receive an Arizona state tax credit of up to $400 if you are married and filing jointly or $200 if you are married and filing separately or a single taxpayer or head of household. If you give $100, you will be eligible for a tax credit of $100. If you give $600, you will be eligible for up to a $400 tax credit, depending on your tax liability and filing status, as well as a tax deduction for any amount you donate over the tax credit limit. Of course, your entire contribution is also eligible as a tax deduction on your federal tax return.
When is my baseline year?
Your baseline year is the first year – as early as 1996 – that you itemized charitable deductions on your federal tax return. If you did not itemize in 1996, then the first year that you did itemize will be your baseline year. Once established, your baseline year does not change unless you change your filing status.
If I didn’t give to a charitable organization last year, can I still get a tax credit this year?
Your baseline year begins with the first year you itemized your charitable contributions (but no earlier than 1996). If you have not previously itemized your charitable contributions, you must establish a baseline year. Once you establish the baseline year, you become eligible for the tax credit the following year. If you are unsure if you qualify for the tax credit, you should contact your tax advisor for clarification.
Can I take the tax credit if I don’t owe any money to the State of Arizona when I file my taxes?
The tax credit reduces your tax liability and will serve to increase your tax refund if you have paid in more in taxes than you owe.
How do I document my contribution?
Catholic Charities sends all donors a letter confirming your contribution. This letter documents your contribution and is necessary to support your tax credit.
How do I file for the credit?
You or your accountant should complete AZ Form 321, a simple tax form, to claim the credit. The form is included with materials provided by the State of Arizona to all state tax filers.
Where can I get more information about the tax credit?
Information can be found at the Arizona Department of Revenue website at www.azdor.gov/brochure/710.pdf or by calling Taxpayer Assistance at 602-255-3381 or 800-352-4090.
Catholic Charities is a qualified 501(c)(3) nonprofit organization and gifts are tax deductible as provided by law, and is a qualified charitable organization for the Arizona Working Poor tax credit. Please note that Catholic Charities is not a tax advisor. Please contact a qualified tax advisor for advice on your personal tax situation.
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